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Supermarkets start war on diesel prices

Decisions by Tesco and Sainsbury's to cut the pump price of diesel by 2p per litre could spark a price war, according to the RAC.

The supermarkets, which together have 800 filling stations in the UK, said the change will come into effect tomorrow.

Peter Cattell, fuel director for Tesco said: "With summer holidays just around the corner, we're helping our customers to get away with their families by dropping the cost of diesel by 2p per litre at all of our 500 filling stations from tomorrow."

Avishai Moor, Sainsbury's head of fuel, said: "This is another great piece of news for our customers today, following the announcement that fuel duty will remain at the same level this year.

"Fuel can be a big expense, so we're proud to be offering our customers great value for money when they fill up with Sainsbury's."

RAC fuel spokesman Simon Williams said the move should prompt similar moves from other retailers and could be the start of bigger falls in diesel.

He said: "This is welcome news for diesel drivers coming just in time for the summer holidays and it is exactly what our RAC Fuel Watch monitor has been calling for.

"The wholesale price of diesel has been significantly lower that of petrol throughout June. We believe that there is scope for at least a five pence cut in the price of diesel which will be the first time that motorists have seen diesel cheaper than petrol at the pumps in almost fifteen years."

Mr Williams said: "We need greater transparency and a fairer pricing model for both petrol and diesel and this is likely to spell the end of the focus on petrol prices alone."